Vietnam Plans to Achieve 70% Mechanization in Rice Cultivation by 2015

11 Aug 2010 • by Natalie Aster

Agriculture plays an extremely important role in Vietnam’s economy. This sector contributes 24% to the national GDP, accounts for nearly 30% of total export value, and employs over 60% of the country’s economically active population. In recent years, Vietnamese agricultural production has obtained rapid, steady growth. The agricultural production value achieved an average increase of 5.5% per annum.

Although Vietnam agricultural economy reached many achievements, the average farmer’s income is still very low, and there are large disparities between the different zones across Vietnam. Increased production, processing and trade in all regions of the country are essential requirements for the creation of an equitable basis for increasing income and reducing poverty.

Agricultural mechanization is pivotal for rural production intensification, improvement in yield and quality of main crops. The current level of mechanization in Vietnam is as low as 1.16 hp, to compare – this level amounts 6.6 hp in China. Vietnam's Ministry of Agriculture and Rural Development is at the forefront of the mechanization program. Major crops like rice, sugarcane, corn and coffee will be the major targets of the mechanization program. By 2015, Vietnam believes it can achieve 70% mechanization in rice cultivation.

According to FAO estimate, number of agricultural tractors in use in Vietnam is approximately 163,000 items, and number of combine harvester - threshers is 223,000 items. Apart from using combined harvesters, Vietnam is also pushing for the use of machinery in producing rice seeds. At the same time, most of the milling equipment in the country are at least 50 years old and could no longer be as efficient as the new-generation equipment produced.

Vietnam has about 1,300 companies manufacturing agricultural machinery and competing for the market. But the agricultural equipment production rate does not suffice the demand. The country imports more than 60% of agricultural production machinery from China. Many components used to produce machinery locally are also Chinese imports. Experts note, that even for a ‘made-in-Vietnam’ combine harvester its three most important parts are imported. Shops always import second hand engines from Japan and South Korea and gear boxes and chains from China.

Within 5-year period Vietnam imported 12,000 items of agricultural machines (new and second hand). That accounts only 2-3% of all agricultural machines in use. The major part of machines in use in Vietnam is old and renovation rate is low.

More information on the farm equipment and machinery market in Vietnam may be found in the report Farm Machinery Market in Vietnam: Business Report 2010 recently published by TD The Market Publishers, Ltd.

Source: MarketPublishers, Ltd.